Newcastle Building Society has announced its 2021 financial results to 30 June, with a "robust" performance, a buoyant mortgage market and a growth in savers.

The Society’s operating profit before impairments and provisions was £13m for the six months ended 30 June 2021, compared to £7.3m for the first half of 2020, with the Society continuing to offer savings interest rates significantly better than the UK average – paying an average rate of 0.83% compared to a whole of market average of 0.32%.

It recently announced that Phil Moorhouse would be standing down as chair, to be replaced by North East of England Chamber of Commerce chief executive James Ramsbotham.

Newcastle Building Society chief executive officer, Andrew Haigh said: “Although we are experiencing positive uplifts in the economy, we are mindful that uncertainty continues to dominate not just the economic environment, but the lives of our members too and is likely to continue for some time.

“The resilience we demonstrated in 2020 laid the necessary foundations to deliver strong results in the first half of 2021, despite Covid-19 restrictions and uncertainties. We’ve continued our focus on helping communities recover from the impacts of the pandemic, and driven innovations in home ownership to help borrowers onto the property ladder, particularly those with lower deposits.

“We have continued to focus on the role we play and the difference we can make for our customers and communities across our region. While there is no doubt we are not yet clear of the pandemic and all the challenges it brings, we are well placed to move forward with confidence, to continue to invest for the future and to remain focused on delivering on the Purpose-led strategy which has served our members, communities and the Society so well throughout.”

A strong mortgage market in 2021, fuelled by a combination of government intervention and a shift in the needs of home owners, helped the Society report gross mortgage lending of £483m for the first half of the year - a 35% increase on the first half of 2020.

Net core residential lending was £220m, compared to £228m delivered in full year 2020. Mortgage arrears remain at low levels at 0.43% demonstrating the consistent quality of the Society’s mortgage lending. 

In the first half of 2021, Newcastle Building Society welcomed more than 2,300 new mortgage customers, and while the difficulties of raising a deposit meant the dream of home ownership has stayed out of reach for many people, the Society now offers five different mortgage support products to help first time buyers or buyers with small deposits own their own home.

The Society has continued to invest in its branch network as part of an ongoing multi-million pound programme of improvement to benefit communities, branch customers and colleagues. In partnership with North Tyneside Council, plans for a new branch within a refurbished Tynemouth Library building were revealed earlier this year.

Relocation of the Society’s West Denton branch also got underway to create a more modern, accessible and welcoming space for customers. The Society’s branch in Bishop Auckland will be next to undergo a major refurbishment later this year, as part of a programme of work that was originally put on hold due to Covid-19.

The Society’s financial advice subsidiary, Newcastle Financial Advisers, which provides access to face to face advice on the high street, has delivered another strong performance in the first half of 2021. In the past six months, Newcastle Financial Advisers has successfully grown its customer base, level of funds invested, and funds under management, well ahead of planned targets and continues to deliver an outstanding customer service.

Recognising that the pandemic has brought significant challenge to its communities, the Society’s community grant-giving programme through the Community Foundation Tyne & Wear and Northumberland was refocused to support Covid recovery by providing ongoing support to programmes delivering employability skills and experience; addressing food poverty; and helping with debt management.

In the first half of the year, £111,000 of support grants across these areas of focus have been provided or committed.

Following the 2020 launch of a £1.1m partnership with the Newcastle United Foundation to deliver a new community hub for sports, education and wellbeing, the Society marked a key point in the construction in May. At a ceremonial signing of the building foundation steels, colleagues were joined by two participants from the NU:Futures programme who, following completion of the programme supported by the Society, have gone on to full employment.

The Society also continues to offer support through volunteering, with colleagues having delivered the equivalent of more than 148 days of volunteering in their communities in the first half of 2021.

Early in 2021 the Society moved out of its Newcastle city centre head office, reducing its head office building footprint from two to one. The Society is investing in its building at Cobalt Park, North Tyneside, with a substantial programme of transformation underway to provide a future-friendly hybrid working environment for colleagues.